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1. Background
The halal industry is expanding rapidly, and new categories have been created, moving halal closer towards connected halal value systems (Wilson, 2013). Despite the significant market size of halal food, there is an evident gap in serving the increasing demand for high-quality food that is credibly halal. As dedicated halal food companies are highly fragmented, they are struggling to scale up and operate efficiently (Thomson Reuters, 2013). Within the huge halal market segment, there is a great diversity of Muslim markets with their own specific requirements, shaped by the different Islamic schools of thought, fatwas (religious rulings) and local customs (Kadirov, 2014; Wilson et al., 2013; Wilson, 2012; Temporal, 2011; Tieman, 2011). Surveys among Muslim consumers in Muslim and non-Muslim countries show the importance of halal control, separating halal from non-halal up to the point of consumer purchase, and the willingness to pay for a halal supply chain system (Verbeke et al., 2013; Tieman et al., 2013; Kamaruddin et al., 2012).
Access to finance is a main issue for small and medium enterprises (SMEs). Islamic financing products, such as mudarabah (partnership in profit, whereby one party provides capital and the other party provides labour) and musharakah (an agreement between two or more parties to combine their assets, labour or liabilities for the purpose of making profit) are tailored for this (ISRA, 2011). However, as Islamic banks try to avoid uncertainties, these schemes have not been widely used (Abdul-Rahman et al., 2014; Huda, 2012; Asutay, 2012).
Commingled commoditisation of food and (intervention, subsidies, protection) distortions are causing food supply chain disfunction in many countries (Williams, 2012). Food security is a growing concern worldwide (FAO, 2013; Tomlinson, 2013; Brown, 2012; Barrett, 2010; Godfray et al., 2010). Many countries will be affected by this food supply shortage, particularly the third-world countries with large Muslim populations (HDC, 2014a). The lack of food security is furthermore becoming a great concern for the stability of Muslim nations (Maystadt et al., 2012) and can, therefore, be regarded as the weak link. Therefore, there is a need for a more sustainable food production (Godfray and Garnett, 2014; Marsden and Morley, 2014; Foley et al., 2011; Aiking, 2011; UK Food Group, 2010) and reduction...